RegTech Profiles: Laxmi Ramanath - La Meer - Governance, Risk and Compliance (GRC)
Laxmi Ramanath, the founder / CEO of La Meer Inc., a company featured as part of the latest cohort of the RegTech100, connected with me on LinkedIn 11 years ago, almost to the day. When we first met, she was four years into her journey of developing software solutions that address regulatory compliance and risk management challenges for financial services companies. At the time, the Global Financial Crisis was raging and the fallout of Wall Street’s excesses was ravaging the whole economy. Rather than make her panic, give-up and close shop, the GFC as cool kids refer to it these days, renewed Laxmi’s commitment to her company’s mission and her life’s work of building the controls that could spot risks, and safeguard consumers and communities. She argues that better Regulatory Technology or RegTech matters because it ultimately protects “the common man.” I caught-up with her by Zoom this past week to talk about La Meer’s recent successes, the impact of the RegTech100 mention, and upcoming plans to capitalize on the recognition. She opened up expressing gratitude for the validation from a credible source like RegTech Analyst / FinTech Global whose rankings are not subject to any hint of pay-to-play. I was not surprised she said that out-loud because Laxmi has a keen eye for conflicts of interest and a moral compass that never deviates. Her road may have been long as she has not taken outside investor cash and has gone one step at a time, while self-funding from revenue. In terms of the lift for her brand, she has seen more visits to her web site and has fielded prospective client inquiries from as far as Australia, where she has done zero marketing. It is a true “if you build it, they will come” story. Understanding La Meer: La Meer follows a product first approach, with licensed software sold as multiple modules of the GRACE suite in the Governance, Risk, Compliance or GRC niche. La Meer also has a professional services practice but it is engaged only on request from clients, rather than proactively marketed. The modular implementation and pricing approach lets financial services client organizations focus on their most pressing area of need. Clients can add future modules to the solution as their needs grow without disruption to the existing implementation or additional costs of integration. La Meer thinks about Risk and Compliance at the firm-wide, comprehensive and interconnected level but realizes that for the client, it can often be too much to take on all at once. Rather, a “pay-as-you-go” / “build-on as you grow” approach is more suited for today’s constrained budget and mental bandwidth. GRACE is comprised of eight core products priced competitively based on seat licenses, number of modules activated and volume of data. Each of these products encapsulates lessons from Laxmi’s 30+ years of experience solving real-world problems as a technology practitioner with a formal Physics background. The range of the products is impressive: from Anti-Money Laundering (AML), Trade Monitoring, Branch and Rep Monitoring for conflicts of interest or outside business activities, Insider Trading, GRC, Regulation Best Interest “Reg BI”, Privacy (GDPR, CCPA), to Enterprise GRC and more. Across the GRACE suite, there is a common architecture where everything is built on Oracle and offered as SaaS delivered flexibly via cloud, on-premises, hybrid or hosted private cloud… depending on client needs and preferences. Unlike some software vendors who have grown their product through acquisitions and slapped a logo across parts that are not truly integrated, GRACE’s consistency is born of the fact it was designed by the same people, module by module, over 15+ years. GRACE also plays well with others by favoring interoperability via APIs for feeds like Dow Jones, Morningstar or vendors who access political contributions data from public records. La Meer is open to discussing partnerships, for example, with others who have aligned with Salesforce to serve the wealth management industry. Q&A with Laxmi Ramanath: Frank Galea: Thinking about how you run your business, what are your targets or key metrics? Laxmi Ramanath: I want, above all else, to become the vendor of choice across my key client segments. You can’t measure that through a single number or KPI but it means the end buyer has to become familiar with who we are, what we stand for. The RegTech100 and other accolades are important milestones to building brand awareness. We’ll certainly leverage these as we revamp our marketing materials, we’ll weave them into our demos. At the core though, building excellent products is our top priority. Given our team’s intentional near exclusive focus on making the products the best they can be in their segment and closely aligned to regulations and expectations during regulatory examinations, we use partnerships and sales channels to connect us to our ultimate clients. Our solutions are built for small and big clients. We have built it consciously to make them affordable for every size of organization. One of our sales strategies, is to work with service providers who can use our tool and provide their service. For e.g one of the segment areas for us is Broker-dealers who can offer our tools to their RIAs when they are dual registrants. It can help build them be compliant, but also help their business gain competitive advantage by offering integrated solutions to their RIAs. As La Meer’s CEO, my role, in large part, is nurturing the sales channel and building our partnerships that can help us sell to a large number of clients and help our partners also build their revenues by offering our state of the art solution suite. FRG: How do you assess your products and their maturity? LR: GRACE has really matured in just the last 2 to 3 years and feels like it is comprehensive in many rule areas. I’m also very happy that we are seeing the rewards of our commitment to the Oracle platform. The La Meer architecture also now stands ready for application of Artificial Intelligence (AI) and Machine Learning (ML) pointed to the backend data to glean, via predictive models, insights that are immediately actionable for our clients. All of the workflows in GRACE predate this predictive layer and sit on a single architecture and integrated data model, when you add the AI component, it’s incredibly powerful. We have the runway in place for analytics to deliver value. I believe that the use cases will come faster and faster, whether we’re looking at topics like suitability in the Reg BI context or identification of outliers in your controls via GRC modules. FRG: What are some of the challenges you face? Are there challenges either hiring the right talent, competition, acquiring clients? LR: One thing we noticed is that sales cycles are getting a bit longer. Clients really put thought into their decisions and they have a lot of conflicting priorities and organizational chaos. Sometimes I’ll have a prospect go silent and when I reconnect with them, they are grateful to hear from me and apologetic explaining that they just have too much going on. It’s a cliché but it’s true - there really has been an acceleration with COVID where more work is being put on stretched internal Compliance and Risk teams. On the other hand, the pandemic has also been an accelerator for us and a boon for our business like we’ve never seen. When I started La Meer, my initial focus had been the US market and US regulations, but with the convergence in regulations, a lot of the tools that were purpose-built to a US rule can be very easily adjusted to a European standard. Today, everyone is working remotely so it eliminated many of the barriers to truly global business. Technologically, we’re able to deliver via an AWS architecture so we were always “global ready”. I find now that I can as easily serve a Luxembourg-based client or a Singapore client as a US client. In terms of challenges, it really comes down to scaling – more customers means you need to grow. You ask yourself if you can you maintain quality at scale. For me COVID was the moment the light went on and so I can see myself in scoring position on a much bigger playing field than I had scoped in 2010. You also mentioned talent; that is an area where I have been fortunate and I am very grateful for my team. The way I keep them engaged is by being extremely open with my team. All of the discussions have the purpose of developing the next generation of operations leaders so that I can, as founder, focus on vision and strategy. I’ve turned Risk into my business opportunity so likewise we turn mitigating La Meer’s key person risk into everyone on the team’s career development opportunity. One final word on hiring, we have, with RegTech 100 mention, gotten more inquiries from top talent wanting to join us. FRG: What are your hopes for La Meer in the next few years? LR: “May all the products find their markets” is my prayer. In the next 5 years, we’ll see more implementations with larger keystone clients in each of the core markets. I was surprised by how easy it was to go from US to global market. We already have the multilingual support in place in Oracle and La Meer. On the strategic side, I look forward to potentially unlocking value with an exit of individual products to strategic acquirers in each segment. There is a payoff in the long game of having built a modular product. What comes together module-by-module for the benefit of my clients can as well be disassembled and recombined to create greater value and synergies.
Published by Frank Galea, CFA CCO / VP of Compliance - Alternative Investments Published • 3/08/2021 International Women’s Day: RegTech female CEO profile: Laxmi Ramanath, founder / CEO of La Meer Inc., an Enterprise Governance, Risk and Compliance (GRC) SaaS solution recently named to the RegTech 100. hashtag#compliance hashtag#riskmanagement hashtag#grc hashtag#saas hashtag#ceo hashtag#regtech hashtag#womenbusinessowners hashtag#womenintechnology